High declined transaction rates are a major pain point for many e-commerce businesses, especially those in high-risk industries. Imagine losing 20-40% of your sales simply because payments aren't going through! This article will explain how a multi-acquiring approach can significantly boost your approval rates and keep your customers happy.
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The Limitations of Single Acquiring
Traditionally, e-commerce merchants sign a contract with a single acquirer, limiting their customers' payment options and giving them little control over the approval process. This can lead to the following issues:
Limited Payment Methods: Customers may not have their preferred payment method available, leading to cart abandonment.
Passive Management: You have no way to actively route transactions based on user behavior or payment type, potentially missing out on approval opportunities.
Why Transactions Get Declined
Understanding the reasons behind declined transactions is crucial for tackling the problem. Here's a breakdown of the most common culprits:
Generic Decline (30-40%): This broad category can be addressed by using alternative acquirers or payment methods.
Insufficient Funds (20-30%): While you can't magically increase a customer's balance, offering "Buy Now, Pay Later" solutions can help.
Incorrect Card Information (10%): Streamlining your checkout process and user experience can minimize typos and errors.
Lost/Stolen Card (10%): Not much can be done here, but other payment methods might be available.
Expired Card (percentage not specified): Automatic card data updates can prevent this issue entirely.
The Multi-Acquiring Advantage in E-Commerce
By implementing a multi-acquiring approach, you gain significant control and flexibility:
User and Transactional Data Storage: Learn user behavior and preferences to suggest better payment methods.
Card-on-File System: Securely store user payment data for faster, more convenient checkouts.
Active Payment Method Testing: Experiment with different payment methods to find the ones that work best for your customers.
Tokenization and Wallets: Utilize secure tokens and digital wallets to improve approval rates.
With a multi-acquiring system, your payment gateway can automatically propose alternative methods if the initial attempt fails. This can include local payment solutions and tokens, further boosting your approval rates.
By taking a proactive approach to payment processing, you can significantly reduce declined transactions, improve customer experience, and ultimately increase your sales.
Verestro - Your Flexible Fintech-as-a-Service Provider
We developed a financial technology platform which integrates seamlessly with multiple acquirers globally. If you’re interested in boosting your e-commerce business, you can leverage the fintech features of our all-in-one platform and stay competitive in your market.
Ready to learn more? Contact us today to discuss how we can help you implement a multi-acquiring strategy and optimize your e-commerce payment process.
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